Integrity and Moral Courage in an Environmental Context

Integrity and moral courage is something we discuss in the textbooks and seek to realize in our lives when handling sensitive issues. Unfortunately, its very existence is defined against the backdrop of difficult discussions that few else would have the courage to undertake. Whether discussing corporations or governments, creating environments that protect those who engage in helpful actions for the betterment of society is important for building a nation bent on improvement.

People with integrity  understand the difference between right and wrong before they can think about mustering the courage to tackle major ethical dilemmas. It is the internal code built upon ingrained values that makes it possible for a person to discriminate between those actions that are moral and those that are immoral. If one doesn’t understand the difference there is no moral dilemma for them to deal with.

Knowing that there is a moral issue at hand is based on the way the person interprets information and maintains their integrity. Moral principles are important for the understanding of information and the potential hazards associated with unethical activities. It is absolutely necessary for building stronger societies to expose and tackle problems.

In any situation where unethical or illegal activity is discovered and one must choose one path over another there is going to be stress. Stress comes from the processing of information and understanding the consequences of certain irreversible actions. Any step that changes a person’s course of history is of grave concern.

If one makes a decision to protect the greater good of society and one’s integrity over the needs of job security and personal gain is made, the consequences can be dire. Organizations don’t often assume liability for illegal activities and generally seek to minimize damage, skirt the spirit of laws, and use their powerful connections to influence outcomes of cases.

Taking action can be a life altering event as each side seeks to minimize damage and find the faults of others to mitigate responsibility. Moral courage occurs when one acts with integrity and is willing to accept the consequences of protecting the company, its products, and their own personal integrity; sometimes from themselves.

An open and progressive environment will determine whether or not this moral courage can be realized in any particular entity. The right environment encourages open lines of communication through protections, investigations, correcting misjudgments, and listening to issues before reacting. Blowing the whistle is not an easy process and relies on more than simple belief systems to realize and act. Environments that do not react appropriately will find themselves with less integrity as new expectations become culturally engrained.

8 Standards of International Corporate Ethics

Ethics goes a long way in building trust in an international business system. As information spreads faster along quickening fiber optic cables the world will continue to integrate in terms of interrelated laws, regulations, cultures, and business standards. Having an international standard of ethics is important in ensuring that companies are encouraging  better business environment. 

 When companies move into international locations they will need to understand and respect the cultures of those nations. There is a difference between respecting local culture and becoming involved in unethical practices. When few options are left, organizations can seek to remove themselves from such countries. Each company will decide what they stand for.

Today’s world needs a new way of looking at business and how that business interacts with other countries. Developing strong international ethical systems means that both companies and countries come to an understanding of what a “good international citizen” is. Below you will find 8 ethical standards (Be George, 1997):

1.      Do not intentional direct harm.

2.      Produce more good than harm for host countries.

3.      Contribute to the host countries development.

4.      Respect human rights.

5.      Respect local culture.

6.      Pay a fair share of taxes.

7.      Cooperate with local government when beneficial.

8.      Withdraw from a country if it becomes impossible to act with integrity.

De George, R. (1997). Human rights and the multinational enterprise. Dilemma, 6, 6–14.

The Nature of Values and Authority-Beyond Metrics

Authority is accompanied  with power, and this can be an irresistible aphrodisiac. It is so intoxicating that people continually seek to gain higher levels of authority through wealth, social position, and power accumulation. Positions of power should come with responsibility, and those who do not have the right kind of values should not be entrusted to direct others. People in power positions set the standards for others and can have an enormous impact on acceptable behaviors among their charges.

A study focusing on disengagement theory found that managers who pushed others to engage in misreporting had a direct impact on the moral performance of their subordinates (Mayhew & Murphy, 2014). Supervisor requests were met with willing subordinates who misreported more, rationalized their unethical behavior and didn't feel that bad about it.

Immoral bosses changed the perspective of their subordinates to the point where they no longer could have any remorse. As unethical behavior becomes embedded into the organizational culture, it creates expectations. For those who “play by the rules,” it can seem like an unfair disadvantage.

Performance metrics becomes to define the individual. Companies that do not concern themselves with how these metrics were achieved will find themselves engage in more immoral activities. Whether the metric is associated with sales or production, the result should include an expectation of ethical behavior in its achievement.

All organizations, whether public or private, should seek to recruit and develop authority figures with moral sentiments. When tough decisions need to be made it is those with an internal moral compass who can make the right choices while those who are self-seeking and need external gratification will be more likely to support unethical behavior. The values of the authority figure will soon spread to their subordinates and create a new way competing.

Mayhew, B. & Murphy, P. (2014). The impact of authority on reporting behavior, rationalization and affect. Contemporary Accounting Research, 31 (2).

Call for Papers: Forum for Interdisciplinary Dialogue: Ethics and Development

Date: 10th to 11th April 2015 Location: Charlottesville, VA, United States of America

Organized by: Jefferson Scholars Foundation
Deadline for abstracts/proposals: 30th November 2014
Website: http://www.jsfconference.org/
 
The Jefferson Scholars Foundation and the Jefferson Society of Fellows at the University of Virginia present the fourth biannual Forum for Interdisciplinary Dialogue (FID) to be held on 22-23 September 2015 at the Jefferson Scholars Foundation Hall in Charlottesville, Virginia. The FID is an interdisciplinary conference for students, faculty, and community members from around the world. The theme for 2015 is Ethics and Development

The Ethics of Making Education Affordable and Accessible

An article in the Journal of Business Ethics that discusses non-traditional education brings forward some interesting points about ethics in the higher educational system. The primary argument discussed whether non-traditional models are moral. Secondary arguments included the need to generate research to be of benefit to society. Below you will find a few points that could have also been included in the paper. 

Certainly it is important to consider the secondary outcomes of all educational systems that include research and creative scholarship. The problem is that the characterization of non-traditional schools offering little benefit to society is misplaced. Online universities are now involved in producing research in their respective fields and offering that research for public consumption. 

It can be argued that online universities will likely offer more research and publication output in the future as they grow to maturity. A number of online universities are currently providing grants, stipends, and other resources to faculty who conduct and publish research. We will soon find the market more reflective of their online leadership status. 

It is also important to evaluate traditional universities with the same criteria as non-traditional universities to make a more apple to apple comparison. Traditional university costs have risen to such a extent that states are now having a difficult time balancing their budgets and will need to either cut education or take from unrelated government programs. The costs on society continue to rise.

In the past the online modality was seen as a poor way to obtain a formal education. However, research has pointed out that such logic was full of fallacies and online education produces the same or better outcomes than many ground based modalities. Slowly but surely a number of critics have come to accept the research that has been produced by independent bodies.

For generations higher education was a stepping stone to a better lifestyle.  That stepping stone wasn’t available to many minorities and people of lesser financial means. Higher education effectively blocked certain groups from obtaining a degree and a better lifestyle; that trend for some schools continues today. Non-traditional schools have opened their doors to anyone who has the motivation and skills to succeed.

The lines between traditional and non-traditional are increasingly blurred. Traditional universities now accept and implement online education as an important modality and are moving in this direction while a number of online educators own traditional campuses that went broke under the traditional model. As one industry matures and the other adjusts there will be a meeting closer to the middle.

Online education is here to stay and isn’t going away. Judging non-traditional education requires having familiarity with the industry and its trends. We must embrace the future and encourage change to make education more affordable and accessible to all. Whether a university is profit/non-profit, private/public, or online/ground should make no difference if the quality of education is high and it provide advantages to society. 

Natale, S., Libertella, A. & Doran, C. (2015). For-profit education: the sleep of ethical reason. Journal of Business Ethics, 126 (3).

A Systemic Approach to Improving Corporate Performance

William F. Roth  PhD

                                            

The concept that needs to be introduced at this point is “systemic thinking,” a concept very much in vogue twenty-five years ago that eventually fell out of favor, overshadowed, unfortunately, by more quantitative approaches. The systemic approach to management is built on two pillars. The first is the belief that “a whole is more than the sum of its parts.” This means, basically that the interactions between the parts of an organization are just as important as the parts themselves in terms of the organization meeting its objectives.

The second pillar of the systemic approach is the “Development Ethic.” It says that employees should be encouraged to develop and utilize their positive potential to the fullest possible extent in order to improve their quality of work life and of life in general and to improve the fortunes of the company. 

Organizations that have become “systemic” in nature possess four key characteristics. First, they are truly participative in the sense that every employee affected by a decision is allowed some level of input into that decision. Second, organization activities are integrated on all levels and between all levels. Third, organizational activities facilitate the on-going learning of all employees. Fourth, the organization is capable of dealing with continual change in both the external and internal environments, change that is occurring with increasing rapidity.

How do we design an organization that has these characteristics, shaping the involved organization processes in such a way that they support the highest possible level of productivity? First, turn support functions into profit centers. They sell their service to production units. This is a bad idea, right? Without competition they would be free to overcharge. But what if production units were free to buy the involved service from an outside supplier if that supplier was cheaper?  Input Units would then be forced to compete. Also, under this arrangement, because they were now profit centers, Input Units could sell their services to other companies so long as no conflict of interest existed, thus improving corporate profits.

Second, reshape the reward system so that it encourages all the desired systemic organizational characteristics. The “Three-Tiered Reward System” fits well with this model. All employees receive salaries that will constitute the smallest part of their reward during good times and will allow employees and families to survive during bad times. All Output and Input Unit employees receive a share of a percentage of their unit’s profits.  Finally, all employees will receive a company-wide bonus, one normally comprising the largest part of their reward in order to keep employees from focusing on the productivity of their individual units rather than on the productivity of the organization as a whole, in order to encourage organization-wide cooperation and integration.  In this model, upper level salaries will be supported by a tax levied on each unit’s profits. Members of upper level management will be eligible to share in the company-wide bonus which will also be drawn from the unit tax revenues.

Third, decision making will be turned over to a hierarchy of “boards.” Each manager, starting at lowest level will have a “board of directors” on which he or she sits. Other members of each board include the manager’s direct reports, be they low level workers or other managers, and the boss of the manager whose board it is. The direct reports, if they are also managers, of course have their own boards and bring along input from their direct reports who also have boards. The boss, as well, has his or her own board on which the boss’ boss sits, bringing along input from his or her boss who sits on his or her board. As a result, any manager above the lowest level receives input, direct or indirect, from three levels below and three levels above.  Boards can also invite representatives from other units who might make a contribution to take part in meetings. Obviously, this approach encourages both participation and the integration of efforts.

Each board’s responsibilities will include:

2. Planning for the unit whose board it is.
3. Policy making for the unit whose board it is
4. Coordinating the plans and policies of the immediate lower level.
5. Integrating the board’s plans and policies with those of lower level and higher-level units.
6. Improving the quality of work life of those the level board governs.
7.  Evaluate on an on-going basis the performance of the manager whose board it is.

What these level boards do, of course, is take over the major responsibilities of management. The manager whose board it is becomes mainly a facilitator, making sure that the board’s efforts remain focused on the organization’s long-term objectives, facilitating and helping integrate the efforts of his or her board with those of other boards.

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